![]() The standard mileage rate includes an allowance for expenses that you could typically claim as actual vehicle expenses, such as insurance or registration. ![]() ![]() Which method is more advantageous depends on your specific situation. To do this, divide total business miles by total personal miles, then multiply the result by the expense. However, if you use the same vehicle for both personal and business driving, you must prorate the expenses based on business miles driven versus personal miles driven. If you lease your vehicle, you can include your payments if you own your vehicle, you can include depreciation on your vehicle. You can include the cost of oil, tires, registration, insurance and repairs. Your deduction for actual expenses includes more than just your gas receipts. If your employer furnishes the car that you use for work-related purposes, you cannot use the standard rate. You cannot use the standard rate if you have at least five vehicles in simultaneous use for business purposes. However, if you lease your vehicle, you are locked in to the standard rate for the duration of the lease term. In subsequent years, you have the option to deduct actual vehicle expenses or continue to use the standard rate. To claim the standard mileage rate for miles driven in a vehicle you own, the IRS requires you to base your deduction on the standard rate for the first year in which your vehicle is used or available for use for work-related tasks. In most cases, you can choose to use the IRS standard mileage rate for business miles or claim your actual expenses, but certain circumstances may restrict you to only one choice.
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